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General Certificate of Secondary Education
June 2011
Business Studies
413002
Growing as a Business
Unit 2
Mark Scheme
Mark schemes are prepared by the Principal Examiner and considered, together with the
relevant questions, by a panel of subject teachers. This mark scheme includes any
amendments made at the standardisation meeting attended by all examiners and is the scheme
which was used by them in this examination. The standardisation meeting ensures that the
mark scheme covers the candidates’ responses to questions and that every examiner
understands and applies it in the same correct way. As preparation for the standardisation
meeting each examiner analyses a number of candidates’ scripts: alternative answers not
already covered by the mark scheme are discussed at the meeting and legislated for. If, after
this meeting, examiners encounter unusual answers which have not been discussed at the
meeting they are required to refer these to the Principal Examiner.
It must be stressed that a mark scheme is a working document, in many cases further
developed and expanded on the basis of candidates’ reactions to a particular paper.
Assumptions about future mark schemes on the basis of one year’s document should be
avoided; whilst the guiding principles of assessment remain constant, details will change,
depending on the content of a particular examination paper.
Further copies of this Mark Scheme are available to download from the AQA Website: www.aqa.org.uk
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Business Studies - AQA GCSE Mark Scheme 2011 June series
1
Total for this question: 21 marks
1 (a)
What does it mean if a company has limited liability?
(2 marks)
Answers may include the following:




business seen as a separate entity to owners
business can be sued as an organisation
shareholders not personally liable for business debts
business is registered with Companies House.
One mark for identifying valid point and one mark for development.
Or two valid points identified.
Both A01 marks.
1 (b)
How does having an objective help Fine Tune Aerials Ltd?
(4 marks)
Answers may include the following:
 gives Fine Tune Aerials Ltd a focus, something to aim at, eg doubling sales revenue in five
years
 allows FTA to judge how well it has performed
 ensures that resources are directed to an appropriate use.
NB: candidates might give more than one reason. It is possible, however, to achieve maximum
marks for one reason only.
Level
Descriptor
Marks
Assessment
Objective
AO2
2
Describes how having objectives helps FTA.
4–3
1
Identifies how objectives help a business.
2–1
0
No valid response.
AO1
0
3
Business Studies - AQA GCSE Mark Scheme 2011 June series
1 (c)
Explain the benefits to Fine Tune Aerials Ltd of growing in size.
(6 marks)
Answers may include the following:




allows FTA to negotiate cheaper supplies
FTA is in a stronger trading position than its competitors
more vans etc so becomes better known
makes certain forms of advertising more accessible, eg radio.
Level
Descriptor
Marks
3
Explains benefit(s) of growth for FTA.
6–5
2
Explains benefit(s) of growth.
4–3
1
Identifies benefit(s) of growth.
2–1
0
No valid response.
Assessment
Objective
AO2
AO1
0
4
Business Studies - AQA GCSE Mark Scheme 2011 June series
1 (d)
Do you think that Fine Tune Aerials Ltd should relocate to a larger city? Use
Item A to justify your answer.
(9 marks)
Answers for moving may include the following:




larger market
possibly less travelling to do, customers closer together
more workers to choose employees from
more likely to be kept up-to-date with developments in the industry.
Answers against moving may include the following:




needs to find base, etc
further commuting distances for managers
could be more competition
need to become established/get known.
Level
Descriptor
Marks
Assessment
Objective
4–3
AO3
AO2
3
Analyses issue(s) relating to relocation for FTA.
2
Describes how relocation issue(s) are applied to FTA.
2
1
Identified issue relating to relocation.
1
AO1
0
No valid response.
0
Note: AO3 also assesses candidates’ quality of written communication. When deciding on the
AO3 level to be awarded, consider the degree to which the candidate orders and communicates
his/her ideas.
Level
Descriptor
Marks
Assessment
Objective
Offers judgement plus clear justification.
E2
Ideas are communicated using a logical structure,
with some appropriate use of technical terms. There
are occasional errors in accepted conventions of
written communication.
5–3
AO3 and
Quality of
written
communication
Offers judgement plus limited justification.
E1
Ideas are communicated with some structure evident
with occasional use of technical terms. There are
noticeable errors in accepted conventions of written
communication.
5
2–1
Business Studies - AQA GCSE Mark Scheme 2011 June series
2
Total for this question: 23 marks
2 (a)
Describe two suitable ways in which Midlands Timber Ltd might promote its
garden furniture.
(4 marks)
Answers may include the following:




advertise in suitable media
flyers given out
special promotions made available to retailers, eg free sunshades
sponsor events, fun day at garden centres.
NB: promotional methods could relate to either/both garden centre and internet sales. Do not
allow any other ‘P’ unless clearly related to a form of promotion.
Maximum of 3 marks for one method described.
Level
Descriptor
Marks
Assessment
Objective
AO2
2
Describes promotional method(s).
4–3
1
Identifies promotional method(s).
2–1
0
No valid response.
AO1
2 (b)
0
Explain why Midlands Timber Ltd’s garden furniture will probably be sold at a
lower price on the internet than at garden centres.
(4 marks)
Answers may include the following:




overheads are lower for internet sales
selling to larger numbers of customers so prices need to be brought down
goods can be made to order as customers expect a time delay before delivery after ordering
no middleman to take a margin.
Level
Descriptor
Marks
Assessment
Objective
AO2
2
Describes how reason(s) leads to lower price.
4–3
1
Identifies suitable reason(s).
2–1
0
No valid response.
AO1
0
6
Business Studies - AQA GCSE Mark Scheme 2011 June series
2 (c) (i) Midlands Timber Ltd sells high quality products and it is important that every one
of its products is made to the same high standard.
Outline a reason why it is important that Midlands Timber Ltd produces a
high quality product.
(2 marks)
Answers may include the following:
 to gain a good reputation/ensure future sales
 to avoid having goods returned for repair
 to give employees a pride in what they do, so retain staff.
One mark for identifying a reason and additional mark for development.
Both A01 marks.
2 (c) (ii) Explain one way in which Midlands Timber Ltd can make sure that all of its
products are of a suitable standard.
(4 marks)
Answers may include the following:
 have an inspection department/test products when completed
 operate to tight controls/industry standards/procedures
 empower employees to make checks throughout the production process.
Level
Descriptor
Marks
Assessment
Objective
4–2
AO2
2
Describes how the method ensures products are of a
suitable standard.
1
Identifies a suitable method of quality assurance.
1
0
No valid response.
0
AO1
7
Business Studies - AQA GCSE Mark Scheme 2011 June series
2 (d)
Midlands Timber Ltd’s managers want to reduce the number of employees who
leave the business to go and work elsewhere. They are considering two ways of
achieving this:


increasing wages so that they are much higher than those paid in other
similar businesses
giving a loyalty bonus of £5000 to employees who stay with the business for
five years.
What action do you think Midlands Timber Ltd should take? Use Item B to justify
your answer.
(9 marks)
Answers concerning raising wages may include the following:
 would make it less attractive to leave, but the cost of this would be high, could it be afforded?
 what would be the effect on prices and demand?
 it may not just be wages that are the problem, could be working conditions etc.
Answers concerning loyalty bonus may include the following:
 would existing long-service employees receive it? This is a waste as they probably won’t be
leaving
 is five years the right amount of time? Would staff leave after five years without another
incentive?
 this would be costly, equivalent to £1000 p.a. on wages.
L3 responses might consider reasoned solutions or requests for specified additional information
before judgements can be drawn.
Level
Descriptor
Marks
Assessment
Objective
4–3
AO3
AO2
3
Analyses issue(s) relating to staff leaving Midlands
Timber Ltd and how this can be reduced.
2
Describes how issue(s) relating to staff leaving apply to
Midlands Timber Ltd.
2
1
Identified issue relating to staff leaving.
1
0
No valid response.
0
AO1
8
Business Studies - AQA GCSE Mark Scheme 2011 June series
Note: AO3 also assesses candidates’ quality of written communication. When deciding on the
AO3 level to be awarded, consider the degree to which the candidate orders and communicates
his/her ideas.
Level
Descriptor
Marks
Assessment
Objective
Offers judgement plus clear justification.
E2
Ideas are communicated using a logical structure,
with some appropriate use of technical terms. There
are occasional errors in accepted conventions of
written communication.
5–3
AO3 and
Quality of
written
communication
Offers judgement plus limited justification.
E1
Ideas are communicated with some structure evident
with occasional use of technical terms. There are
noticeable errors in accepted conventions of written
communication.
9
2–1
Business Studies - AQA GCSE Mark Scheme 2011 June series
3
Total for this question: 16 marks
3 (a)
What is meant by the term ‘expenses’?
(2 marks)
Indirect costs incurred with operating the business, not direct production costs.
One mark for showing understanding of expenses being a cost to a business.
Additional mark for development, which could include an example.
Both A01 marks.
3 (b) (i) Using the formula in Item C, calculate HLS’s net profit margin for 2010. Show
your working.
(2 marks)
Net Profit Margin = net profit/sales revenue x 100 (given).
2 marks for:
44%, allow 0.44 or 11/25.
1 mark for:
Including 5500/12500.
Or 44 without a % sign.
No marks for:
reciprocal, ie 2.27, candidate has inverted formula.
Both A02 marks.
3 (b) (ii) What does the financial information tell you about HLS’s profits?
(3 marks)
Answers may include the following:
Level one answers:
 net profit margin has reduced from 2009 to 2010
 gross and net profits have increased
 there has been an increase in retained profits.
Level two answers:
 business is less efficient at converting sales to profits – reasons might be suggested.
If answer to 3b(i) used OFR applies.
Level
Descriptor
Marks
2
Explains the change in HLS’s profits.
1
Identifies change in HLS’s profit.
1
0
No valid response.
0
10
Assessment
Objective
3–2
AO2
Business Studies - AQA GCSE Mark Scheme 2011 June series
3 (c)
HLS is considering funding the new fitness centre by either using its retained
profits or by obtaining a loan from a bank.
Which method do you think HLS should use? Use Item C to justify your answer.
(9 marks)
Arguments for using retained profits may include the following:




there is no interest to be paid
it eliminates a major creditor
if project fails there will be no creditors to face
£2.5m<£3m, retained profits for 2010 are insufficient.
Arguments financing with a loan may include the following:
 interest rates are low at the moment
 allows shareholders to receive a larger dividend
 bank shares risk of venture with the business.
Level
Descriptor
Marks
Assessment
Objective
4–3
AO3
AO2
3
Analyses suitability of method(s) to fund HLS’s new
fitness centre.
2
Describes method(s) of funding applied to HLS.
2
1
Identifies method of funding.
1
0
No valid response.
0
AO1
Note: AO3 also assesses candidates’ quality of written communication. When deciding on the
AO3 level to be awarded, consider the degree to which the candidate orders and communicates
his/her ideas.
Level
Descriptor
Marks
Assessment
Objective
Offers judgement plus clear justification.
E2
Ideas are communicated using a logical structure,
with some appropriate use of technical terms. There
are occasional errors in accepted conventions of
written communication.
5–3
AO3 and
Quality of
written
communication
Offers judgement plus limited justification.
E1
Ideas are communicated with some structure evident
with occasional use of technical terms. There are
noticeable errors in accepted conventions of written
communication.
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